Loan Origination Fees

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What are Loan Origination Fees?

We can define loan origination fees, also called underwriting or processing fee, as the amount a lender or bank charges to set up your loan. In most cases, lenders charge a loan origination fee as a specific percentage of the total loan amount.

They are also quoted as a specific percentage of the total loan and are usually from 0.5% to 1% of a mortgage loan in the US. Typically, larger loans tend to come with smaller fees.

Examples of Loan Origination Fees

  • Example 1: Appraisal fee
  • Example 2: Escrow fee

Here’s Investopedia’s definition of Loan Origination Fees .

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